ILFC Loan Repayment Funds the Largest Single AIG Cash Reduction to
Date on FRBNY Loan

August 23, 2010 09:03 AM Eastern Daylight Time

NEW YORK--(BUSINESS WIRE)--American International Group, Inc. (AIG) has applied nearly $4 billion
received from International Lease Finance Corporation (ILFC) to the
Federal Reserve Bank of New York (FRBNY) Revolving Credit Facility
(credit facility), reducing AIG’s outstanding principal balance to
slightly more than $15 billion, not including accumulated interest and
fees.

The payment of $3.95 billion represents the single largest cash payment
AIG has made to the credit facility and is the largest reduction in the
credit facility’s principal balance since AIG placed AIA Group Limited
(AIA) and American Life Insurance Company (ALICO) into Special Purpose
Vehicles last December and exchanged preferred equity interests in AIA
and ALICO for a $25 billion reduction in the balance outstanding on the
credit facility.

The payment also reduces the size of the FRBNY credit line available to
AIG from approximately $34 billion to approximately $30 billion.

“This is continuing tangible evidence of AIG’s progress in repaying the
American taxpayers,” said AIG President and CEO Robert H. Benmosche.
“AIG is getting stronger every day. We still have more work to do, but
we will finish the job and make sure we repay the American taxpayers.”

Mr. Benmosche noted the progress AIG and its subsidiaries have made
during the last year.

“ILFC has demonstrated today further progress in stabilizing its
finances and buttressing ILFC’s balance sheet,” Mr. Benmosche said.
“Closing on the ALICO transaction remains on track and we continue to
work diligently on the initial public offering for AIA.

“Our insurance businesses are profitable; client retention rates have
stabilized; and surrender rates have improved to normal levels. We are
starting to see light at the end of the tunnel.”

With the repayment, AIG’s total principal and interest owed on the
credit facility is approximately $21 billion. AIG anticipates the
repayment will trigger an accelerated amortization of the prepaid
commitment fee asset, resulting in an approximately $650 million pre-tax
charge being taken by AIG.

American International Group, Inc. (AIG) is a leading international
insurance organization with operations in more than 130 countries and
jurisdictions. AIG companies serve commercial, institutional and
individual customers through one of the most extensive worldwide
property-casualty networks of any insurer. In addition, AIG companies
are leading providers of life insurance and retirement services around
the world. AIG common stock is listed on the New York Stock Exchange, as
well as the stock exchanges in Ireland and Tokyo.